Like the New York Yankees in a midsummer slump, the federal government is on a rare losing streak — at least in its efforts to block mergers.

A federal judge's rejection Thursday of the Justice Department attempt to block Oracle's $7.7 billion takeover bid for PeopleSoft marks the government's third failure to stop a merger in recent weeks.

The Federal Trade Commission lost in its bid to derail a coal-industry merger, and Justice met the same fate in its efforts to block a National Dairy Holdings deal. In the past 20 years, federal antitrust enforcers have rarely gone to court to block mergers. When they have, they often win.

Some experts say Justice's theory in the Oracle-PeopleSoft case was flawed from the outset. Justice argued there was a separate market for high-end software for large corporations and that an Oracle merger would leave only two players, Oracle and SAP.

U.S. District Judge Vaughn Walker ruled that Justice had overlooked many smaller software companies, as well as such giants as Microsoft and IBM.

"Software markets are not susceptible to bright-line definitions," Sterling says. "The products and modes of competition are not your typical brick-and-mortar industries. They can be readily substituted with other products. The government took a huge risk in invoking the theory."

That, he says, was surprising for the Bush administration, which has often taken a hands-off posture to big business.

But Sterling says Justice was emboldened by its success in the Microsoft antitrust case, which resulted in a settlement — albeit one criticized as weak — that reined in the giant's business practices.

"The government felt it was on a roll with big players in these software markets, but they bit off more than they could chew," Sterling says.

Former Justice antitrust official Mark Schecter says, "I think it was a tough case for them both on the facts and the theory. "There were only a limited number of customers that were complaining, and (Justice) said each ... was a relevant market."

Howard University law professor Andrew Gavil doesn't agree that prosecutors were too aggressive. But he says conservative courts are taking a dim view of cases that try to delineate tiny markets, noting that the Arch Coal case was lost on a similar theory.